Ben Bernanke thinks his bailout program needs rescuing — from some on Capitol Hill.

The former Federal Reserve chairman said if a bill two senators are pushing becomes law, it would “imprudently limit the Fed’s ability to protect the economy in a financial panic.”

The bill, the “Bailout Prevention Act of 2015,” introduced by Sens. Elizabeth Warren (D-Mass.) and David Vitter (R-La.), is aimed at limiting just how much authority the Fed has to lend money to banks in an emergency situation.

But that would be bad, Bernanke wrote on his Brookings Institute blog on Friday, saying that Fed lending during the 2007-2009 financial crisis — which reached $16 billion by some counts — prevented the collapse of “two systemically critical” firms, Bear Stearns and AIG, and helped unfreeze “dysfunctional markets.”

The bill, if it were to pass, would mean a starkly different scenario.

“If big financial institutions know they can get cheap cash from the Fed in a crisis, they have less incentive to manage their risks carefully — which further increases the chance of another financial crisis,” Warren said in a statement when the bill was introduced.

But limiting the Fed’s emergency powers would be a huge mistake, Bernanke said.
Vitter, when reached for comment, didn’t back down from his proposal.

“The Fed’s past abuse of emergency lending demands reforms,” said Vitter. “Is anyone surprised that the mastermind of the taxpayer-funded bailouts for the megabanks wants to protect the ability to keep bailing them out?”

Bernanke wrote that the lawmakers’ goal, “I assume, is to induce financial firms and market participants to be less reliant on possible government help, for example, by holding more cash to protect against possible runs and panics,” Bernanke wrote.

“But their approach is roughly equivalent to shutting down the fire department to encourage fire safety; or — more relevant to the current context — eliminating deposit insurance so that banks will be more careful.”

Warren’s office didn’t immediately respond to requests for comment.

“Bernanke was the person who conceived of and implemented the largest-ever lending program in the history of the Fed,” Marcus Stanley, policy director at Americans for Financial Reform and a supporter of the bill, told The Post.

“I think his concern for his legacy would be enough to attack this legislation.”